Austria

Background:
Once the center of power for the large Austro-Hungarian Empire, Austria was reduced to a small republic after its defeat in World War I. Following annexation by Nazi Germany in 1938 and subsequent occupation by the victorious Allies, Austria's 1955 State Treaty declared the country "permanently neutral" as a condition of Soviet military withdrawal. Neutrality, once ingrained as part of the Austrian cultural identity, has been called into question since the Soviet collapse and Austria's increasingly prominent role in European affairs. A prosperous country, Austria joined the European Union in 1995 and the euro monetary system in 1999.

Environment - current issues:
some forest degradation caused by air and soil pollution; soil pollution results from the use of agricultural chemicals; air pollution results from emissions by coal- and oil-fired power stations and industrial plants and from trucks transiting Austria between northern and southern Europe

Geography - note:
landlocked; strategic location at the crossroads of central Europe with many easily traversable Alpine passes and valleys; major river is the Danube; population is concentrated on eastern lowlands because of steep slopes, poor soils, and low temperatures elsewhere

Legal system:
civil law system with Roman law origin; judicial review of legislative acts by the Constitutional Court; separate administrative and civil/penal supreme courts; has not accepted compulsory ICJ jurisdiction

Suffrage:
19 years of age; universal; compulsory for presidential elections

Executive branch:chief of state:
President Thomas KLESTIL (since 8 July 1992)
head of government:
Chancellor Wolfgang SCHUESSEL (OeVP)(since 4 February 2000); Vice Chancellor Susanne RIESS-PASSER (FPOe) (since 4 February 2000)
cabinet:
Council of Ministers chosen by the president on the advice of the chancellor
elections:
president elected by direct popular vote for a six-year term; presidential election last held 19 April 1998 (next to be held in the spring of 2004); chancellor traditionally chosen by the president from the plurality party in the National Council; in the case of the current coalition, the chancellor was chosen from another party after the plurality party failed to form a government; vice chancellor chosen by the president on the advice of the chancellor
election results:
Thomas KLESTIL reelected president; percent of vote - Thomas KLESTIL 63%, Gertraud KNOLL 14%, Heide SCHMIDT 11%, Richard LUGNER 10%, Karl NOWAK 2%
note:
government coalition - FPOe and OeVP

Legislative branch:
bicameral Federal Assembly or Bundesversammlung consists of Federal Council or Bundesrat (64 members; members represent each of the states on the basis of population, but with each state having at least three representatives; members serve a four- or six-year term) and the National Council or Nationalrat (183 seats; members elected by direct popular vote to serve four-year terms)
elections:
National Council - last held 3 October 1999 (next to be held in the fall of 2003)
election results:
National Council - percent of vote by party - SPOe 33.2%, OeVP 26.9%, FPOe 26.9%, Greens 7.4%; seats by party - SPOe 65, OeVP 52, FPOe 52, Greens 14

Political parties and leaders:
Austrian People's Party or OeVP [Wolfgang SCHUESSEL, chairman]; Communist Party or KPOe [Walter BAIER, chairman]; Freedom Party of Austria or FPOe [Susanne RIESS-PASSER]; Liberal Forum or LF [Heide SCHMIDT]; Social Democratic Party of Austria or SPOe [Viktor KLIMA, chairman]; The Greens or GA [Alexander VAN DER BELLEN, party spokesman]

Economy - overview:
Austria with its well-developed market economy and high standard of living is closely tied to other EU economies, especially Germany's. Membership in the EU has drawn an influx of foreign investors attracted by Austria's access to the single European market. Through privatization efforts, the 1996-98 budget consolidation programs, and austerity measures, Austria has brought its total public sector deficit down to 2.1% of GDP in 1999 and public debt - at 63.1% of GDP in 1998 - more or less in line with the 60% of GDP required by the EMU's Maastricht criteria. Cuts mainly have affected the civil service and Austria's generous social benefit system, the two major causes of the government's deficit. To meet increased competition from both EU and Central European countries, Austria will need to emphasize knowledge-based sectors of the economy and deregulate the service sector. Growth, which slowed to 2.0% in 1999, probably will rebound to 2.8% in both 2000 and 2001.

Exchange rates:
euros per US$1 - 0.9867 (January 2000), 0.9386 (1999); Austrian schillings (AS) per US$1 - 11.86 (January 1999), 12.91 (1999), 12.379 (1998), 12.204 (1997), 10.587 (1996), 10.081 (1995)
note:
on 1 January 1999, the EU introduced a common currency that is now being used by financial institutions in some member countries at a fixed rate of 13.7603 Austrian shillings per euro; the euro will replace the local currency in consenting countries for all transactions in 2002